As Ford transforms its business through electrification, the company is leveraging and evolving iconic nameplates like F-150 and Mustang. Retaining familiar nomenclature has helped customers recognize the popular Fords as their nameplates have migrated to EVs, industry analyst John McElroy told the Ford Retired Engineering Executives group during a recent virtual meeting.
“It’s been brilliant on Ford’s part,” he said. “One of the great strengths of the Ford Motor Company is its marketing. It was brilliant to have an electric truck that looks like an F-150, and is called an F-150, and it just happens to be electric. And now they can’t keep up with demand.”
McElroy, a journalist, lecturer, commentator and host of “Autoline This Week,” noted the F-150 Lightning’s production run-rate will increase to 150,000 trucks this fall. The naming convention has also helped with the Mustang Mach-E, which is also selling well outside of North America, as well as the E-Transit, he said.
“Contractors and small commercial fleets and the like, they know, and they love the Transit,” McElroy said. “When you call it an ‘E’ Transit, there is a sense of familiarity there and a comfort level. … Using familiar names was a stroke of genius.”
McElroy also praised Maverick and the Bronco family, calling the former “a terrific product and paradigm breaker,” noting that the small truck came with a $20,000 price tag at launch and a standard hybrid engine capable of achieving 40 mpg. “That’s a really compelling thing.”
Meanwhile, the return of the Bronco and addition of the Bronco Sport have posed an unprecedented challenge to the Jeep brand, McElroy said. Bronco sales in December totaled 10,412 SUVs with a 36.4% share of segment – its highest level since launching and up almost four percentage points from November. The Bronco family of vehicles, which includes Bronco Sport, sold 216,604 SUVs last year.
“The Bronco is the first real challenge that the Jeep brand is facing, and it’s taking a toll on Jeep,” McElroy said. “As long as Ford figures out how to come out with products that are just a little bit different than everybody else, like the Maverick and the Broncos, they should do very well.”
The creation of the company’s Ford Pro business unit is another strength, McElroy said, because of the breadth of its offerings, as well as the profit margins on the services it offers. This type of commercial offering is unique to the industry, he added.
“Because Ford has put this together in a package that has been pretty well thought out, you’ve got a whole new business – it’s not just selling vehicles, it’s selling services to fleets,” McElroy said. “It’s a really smart move for a company that’s always had a really good presence in the commercial market to spin this off as its own business unit.”
Ford Pro offers businesses a complete one-stop-shop of productivity solutions across vehicles, software, charging, service and financing so customers do not have to piece together from multiple providers. This includes everything a business would need to operationalize an electric fleet, like infrastructure consulting, charging hardware, software optimization tools and America’s best-selling lineup of electric trucks and vans.
McElroy discussed EV adoption and charging, saying acceptance will come on a regional basis, which will also dictate when public utilities will make infrastructure upgrades to strengthen and cyber-protect the aging American electric grid. Utility companies are concentrating their efforts in areas where EVs are selling well.
While EV owners’ electric bills will likely increase due to home charging, the cost should be offset by the price difference between electricity and gasoline, as well as the superior efficiency of electric vehicles, McElroy said. He estimated that the average person could save about $1,000 per year in fuel costs.
Despite recent increases in EV battery production costs due to demand for key materials, McElroy was confident the price would follow the trend of gradual price decreases the industry has seen over the past decade. Moreover, next-generation batteries could even reduce the cost enough in the coming years to put electric vehicle production costs on par with internal combustion vehicles.
McElroy also touched on the ongoing semiconductor chip crisis, quoting experts saying he expects the situation to normalize by next year. However, demand for chips within the auto industry will continue to increase, even as more chip production is added in the U.S.
The retiree group will hear next from Ford Chief Communications Officer Mark Truby during its February meeting.